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US to blame for China trade friction: Amcham
(Reuters/AFP)
Updated: 2005-09-13 16:38

In the same survey, 68 percent stated they were "profitable" or "very profitable" last year.

The fact that a large number of foreign companies are making money at all in China is a fairly recent phenomenon, linked to China's entry into the World Trade Organization (WTO) in late 2001, Martin said.

"The change from not profitable to profitable clearly is coincident with the WTO," he said.

"When China entered the WTO and started implementing WTO rules, companies started making much more money."

WTO entry dismantled a large number of rules obstructing business in China, allowing wholly foreign-owned enterprises into a broader range of industries than before and so giving foreign investors an immediate profit boost, he said.

While WTO membership has improved the business environment for many foreign enterprises, some select industries are still facing insurmountable obstacles, according to Martin.

"In most countries, construction is hard to get into but the Chinese have put so many conditions on getting into the construction industry that companies are really unable to get in there."

Oil exploration is another area that should be opened up, since China itself might also benefit from such a move, he argued.

"China should open up its oil exploration, particularly onshore, more to foreign companies," he said. "Largely it's been a domestic game."


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